Market took a nasty dive and currently trying to bounce back but is it sustainable!!! No doubt that this market is experiencing correction OR Is this start of something bigger? What should we expect in weeks ahead... Not has much changed in below chart, note the parabolic spike in volatility ($VIX) causing the sudden drop. Break below 10600 level caused the massive drop on very high volume and all market indicators went into oversold conditions. Now market is bouncing back but this bounce may not be sustainable as lot of resistance is ahead of us. If market manages to continue this bounce then most likely it will not be able to overcome the resistance at 10600 area. Expect lot of wild swings and sideways actions for weeks ahead. Weekly chart is showing perfect support areas where the market bounced back. Expect few weeks of bullish action, however it will not be smooth but rather roller coaster ride. RSI is still NOT in oversold territory and the market may test lower level once the bounce effort fades. NYUD was warning us way before the market crash. Unless it turns around, it would be wise to stay on sidelines. Based on current chart pattern, we shall see further wild swings and consolidation pattern for weeks ahead and possible continuation of downtrend further after a pause or bounce. All this might take several weeks/months to cultivate but its better to have a foresight and be prepared.
What does it mean for our Investments?
Market in correction, it would be wise and to stay on the side... Comments are closed.
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